Today let us understand 4Cs of financial wisdom and let us assess which type of individual are we based on the combination of these 4Cs.

C1. Creation of income (Through any economic activity like business, job)

C2. Consumption of income (spending)

C3. Continuation of income (making sure we receive money even if income is not created)

C4. Conservation of income (making sure that in case of any catastrophic event, we or our family do not lose much)

Mostly people are concerned with No. C1 & C2 but do not think of C3 & C4. C1 & C2 improve current state of life, they give a feeling of luxury but it is at the cost of future security.

Most of us never think or try to achieve C3 (Continuation of income) & C4 (Conservation of income). So the question is how can these be achieved? C3 & C4 can be achieved only when C1 (Creation of income) > C2 (Consumption of income). So make sure that you earn enough to save.

Creation of income for most of the people is certain. But it is what they feel. In reality it is not so. One can lose income because the business runs into losses, there may be natural calamity, termination from job, disability, prolonged illness, death and much more. This can impact not only us but also to our dependents.

Categories of individuals based on 4Cs.

Category Component consideration Type of individual What it means
01 Only C1 & C2 where C1 > C2 They care for savings only Such individuals save but lack investing and being adequately insured. They will have a lavish current life but uncertain future.
02 Only C1 & C2 where C1 < C2 They care for spending only Such individuals have a certain future which is dark and they will be dependent on others
03 C1, C2 & C3 They care for savings & continuation They will have a good present and uncertain future in case of major illness or death
04 C1, C2 & C4 They care for savings and conservation They will have a good present and uncertain future in case of loss of ability to earn
05  C1, C2, C3 & C4 Perfect financial planners Such individuals will have a stable life. They may envy other 4 category of individuals in short term but over long term other 4 categories will envy them

So how to achieve Continuation & Conservation???

Continuation can be achieved through investing. Investing in Stocks, Mutual funds, Real estate, LICs certain types of endowment/cash back/annuity policies (Assets which can give a stream of income)

Conservation can be achieved through insurance (Health insurance, Life insurance, Household insurance, Auto insurance). One must have insurance at least 10 times of their annual income.

An exercise for all:

Take 2 chocolates of 1 rupee each. Remove the wrapper of one of the chocolate, drop both of them on the floor and stamp on them wearing footwear. Now you have to eat any one of them. Which one will you eat? Obviously the one with wrapper / cover. The wrapper must be costing 20 paise but it maintains the value of chocolate. This is the importance of conservation (Insurance).

Assess your self. See where do you stand in terms of 4Cs of financial wisdom. Check how do you stand in terms of savings (C1 - C2), check if you have planned for continuation of income in case of sudden income loss, check if you are adequately insured (at least 10 times of annual income)

Many a times I am asked by my investors as to investment in Crypto Currencies. Crypto Currency is not officially accepted in India, but it has become a talk of town for majority people. You may have crypto whose value is in crores but still you cannot directly buy anything with it in India.

A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers. A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.

The gyration in their prices or even their legality notwithstanding, cryptocurrencies have got ordinary investors interested. And, it’s not just about the Bitcoin. Several more coins have joined the party. Dogecoin gave over 8000 percent returns between January and April 2021. Ethereum’s price rose to Rs 1.88 lakh, from Rs 92,593 at the start of the year. But prices fluctuate quite wildly.

Cryptocurrencies are unregulated instruments. Therefore, anyone can start a crypto exchange. “That is why, first, you should check the background of the core team and founders of the crypto exchange,” says Darshan Bathija, CEO of Vauld, a global crypto exchange and lending platform.

Opening an Account to buy:-

You have to follow the know-your-customer (KYC) process while opening an account. Barring minor differences, most exchanges require your Permanent Account Number (PAN) card and an identity proof such as your passport, Aadhaar or driving license. Some exchanges give approvals instantly. Others take up to a week to complete the KYC process. Video KYC is not mandatory for exchanges to on-board investors.

Transferring amounts to exchanges for investing:-

To buy a crypto coin, you first need to transfer money (Rupees) to a wallet that belongs to your exchange. Then, you can buy a coin. You can use internet banking facility (IMPS, RTGS, or NEFT) or debit cards for transferring sums. Your wallet gets credited once you submit the transaction reference number.

Whenever you sell your crypto, you can use the same routes to transfer money back to your bank account.

You can select payment gateways such as Billdesk and Razorpay, and complete the transfer to your account with the exchange. However, you have to bear 1-2 percent additional charges for transferring the amount to exchanges through a payment gateway.

Currently Crypto Currencies do not have legal acceptance but still it must form a part of ones investment portfolio. Investment in crypto currency must not be more than 5% in ones portfolio. There are currencies like Tron which can be gradually accumulated.

If you are looking forward to start investing in cryptos you can make use of platforms like the WazirX and Zebpay. WazirX had some server crashing issues 3 times since April to May. One can look at Zebpay which offers great use friendliness.

You can directly download and start buying crypto currencies from the below links:



Crypto currencies have become an essential vice. They add some risk to portfolio but are also necessary as a part of long term investment strategy.


What is ESG Investing?

ESG (Environmental, Social and Governance) investing refers to a class of investing that is also known as “sustainable investing.” This is an umbrella term for investments that seek positive returns and long-term impact on society, environment and the performance of the business. There are several different categories of sustainable investing. They include impact investing, socially responsible investing (SRI), ESG and values-based investing. Another school of thought puts ESG under the umbrella term of SRI. Under SRI are ethical investing, ESG investing and impact investing.

The Financial Times Lexicon defines ESG  as “a generic term used in capital markets and used by investors to evaluate corporate behavior and to determine the future financial performance of companies.” It is used by investors to evaluate corporations and determine the future financial performance of companies. It adds that ESG “are a subset of non-financial performance indicators which include sustainable, ethical and corporate governance issues such as managing a company’s carbon footprint and ensuring there are systems in place to ensure accountability.” They are factors in investment considerations, used in risk assessment strategies incorporated into both investment decisions and risk management processes.

What is the Appeal of ESG Investing?

Many investors are not only interested in the financial outcomes of investments. They are also interested in the impact of their investments and the role their assets can have in promoting global issues such as climate action.  One demographic that is particularly attracted to ESG investing is millennials. According to a 2006 study called Cone Millennial Cause Study, millennials are more likely to trust a company or purchase a company’s products when the company has a reputation of being socially or environmentally responsible. Half of those surveyed are more likely to turn down a product or service from a company perceived to be socially or environmentally irresponsible.

The Rs 30 trillion Indian mutual funds (MF) industry may have seen five ESG-themed MF schemes rolled out so far in 2020. But a wave of ESG investing has been sweeping global markets for some time now.

Data from research firm Morningstar Investment Adviser showed that in October, global assets under management (AUM) with ESG portfolios hit a high of US$1.2 trillion – a quantum increase from $530 million five years ago. Bloomberg reports state that there were 17 ESG exchange traded funds rolled out so far in 2020, compared with 10 in all of 2019. This launches make October the best-ever month for inflows since 2013.

In India however, ESG funds are still in a nascent stage. But investor interest is increasing. There is awareness about ESG in every aspect of conducting business. Society wants to see businesses being more responsible in these areas and it is already visible in lending practices and investor participation globally.

India has a long road ahead in sustainable investing, given the host of mid and small-sized companies that may find it challenging to comply with such norms. But, experts say that the Indian MF industry is moving in the right direction. As more schemes raise money, investor awareness would improve. Companies that have low ESG scores could lose prominence or importance in the investment horizon, even if they generate higher profits. Such companies stand the risk of losing capital flows, especially from FIIs.

So in all ESG is the future of investment. If one is looking at responsible investing than one must apply for the Aditya Birla Sun Life ESG Fund NFO. Call us to apply. NFO closes 18th December 2020.

The ESG theme must be included in the core portfolio. Returns through the ESG themes are expected to be higher than non-ESG funds with same risk profile.

Time and again I meet many clients and talk about starting SIP with them. The salary of regular clients ranges from Rs. 20000 – Rs. 95000 a month. After concluding, more than 90% have to say that they need to think and calculate if they can afford Rs. 1000 a month. Most of the times clients do not spare Rs. 1000 a month for SIP even after knowing that the amount is not significant compared to monthly income. They are the dreamers who wish to start SIP but cannot.

I usually handle my sales call on phone or online so our house helper usually keeps listening that I talk about investment. She does not know any investment option except bank FD and LIC. One day she inquired what I was actually doing and how can she invest? She wanted liquid investment with combination of risk and return. I suggested her for SIP. Looking at her 4 digit income I suggested her to start with Rs. 100 or Rs. 500 a month. She said I would like to start with Rs. 1000/month. She had paid Rs. 1000/month to a bank agent for 5 years, the bank did not exist in reality. Having lost hard earned Rs. 60,000 she is again ready to invest in an asset she does not understand. This is not because her income is high, it is because of her determination. Such people are Doers.

Her act was an eyeopener to all those having 5 to 6 digit salary but are unable to save and invest. Stop being dreamers, start becoming doers.

An eye opener for parents with no financial planning for their child's future

Recently I had tried to find out investment habits of parents having children in the age range of new born to 10 years. I had indirectly surveyed 50 parents to know their investing habits for their child’s future. I was shocked to find that 95% of the parents had no financial planning for their children. Even more shocking  was when parents told that they had to plan for investing Rs. 100/month for their children. Dear parents, we spend Rs. 300/month/mobile as mobile bills, we spend average 500 Rs. behind our child’s chocolates/ice-cream/cakes (which ultimately leads to medical bills and obesity), we spend Rs. 1000/month for our fitness, we spend 2000/month eating out in the hotel, we spend drinking tea, snacks, fun, kitties and what not. Do these spending have a planning? Do they need a discussion with spouse? To all who had such an excuse, I am sorry but this generation of parents is not serious about their child’s future. I pity such children whose parents have all the money in the world to spend on themselves but need planning and discussion to invest Rs. 100 for their child. Loading our children with gadgets & gifts is not enough. The future is competitive, we have to save for them.

Dear parents, our responsibility does not end bringing our children into this world, It starts from there......

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